Bono: Aid or Trade?

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Bono: Heart in the right place, head not quite there yet

For those PowerBlog readers who don’t follow the world of rock and roll, the man in the photo on the left is Bono (aka Paul Hewson), the lead singer of the biggest rock and roll band in the world – U2. (I feel compelled to mention that I am Acton’s resident U2 Superfan: the proud owner of The Complete U2, regular attender of U2 concerts – I took that photo on May 7 in Chicago – and general aficionado of all things U2-related.)

What you may not have known about Bono is that he has become a relatively influential campaigner on behalf of Africa-related causes – primarily debt reduction, trade issues, and the AIDS crisis. It may surprise you that this rock star has managed to meet with and gain the respect of a wide range of politicians and world leaders, including Presidents George W. Bush and Bill Clinton, Senator Jesse Helms, Tony Blair, Vladimir Putin, Kofi Anan, and even Pope John Paul II (whom Bono referred to as “the first funky pontiff” after giving the Pope a pair of his trademark fly shades).

As a longtime follower of his career, I believe that Bono is totally sincere in his efforts, but sincerity and good intentions don’t always translate into good policy.

Bono’s latest efforts on behalf of Africa revolve around support for the One Campaign, an effort to raise US foriegn aid to Africa by 1%. The Campaign’s website states rather grandly that:

We believe that allocating an additional ONE percent of the U.S. budget toward providing basic needs like health, education, clean water and food, would transform the futures and hopes of an entire generation of the poorest countries.

On their current Vertigo tour of the US, U2 have been urging their fans to text message their names to the electronic One Campaign petition during concerts with the goal of obtaining a list of 1,000,000 supporters of increased foreign aid. It makes for compelling theater, and they’ve made significant headway toward their goal – almost 650,000 people have sent in their names – but will it really help?

It’s hard not to chuckle when reading a statement like the one quoted above. It is completely absurd to contend that after decades of government-to-government foreign aid for Africa that has clearly failed to lift the continent from poverty and borderline chaos, a 1% increase in aid is the answer. In fact, it may just make the problems worse, as noted by Bruce Bartlett:

To be sure, a bit of food and medicine would indeed go a long way toward helping many of Africa’s sick and dying. But Bono and others like him are naive if they think that foreign aid alone is the answer to what ails Africa.

It is too easy for purely humanitarian aid to become a permanent lifeline. Once started, who is hard-hearted enough to cut it off, knowing that death for the recipient will be almost certain? Thus, one-time aid too often becomes everlasting.

Once the prospect of long-term relief is established, it sets in motion forces that virtually guarantee its necessity. For example, food aid to help countries through a temporary famine often drives farmers out of business. How can they sell their produce when wealthy western countries, often overflowing with subsidy-driven agricultural surpluses, are giving it away for free?

Partly for this reason, most nations of Africa have become dependent on food imports, even though they were food exporters not too many years ago. Punitive domestic policies are to blame as well. It is common throughout Africa for farmers to be forced to sell their production to marketing boards, which pay far less than the world price. This is just a kind of de facto tax that allows the government to reap most of the profit.

Not surprisingly, farmers don’t like paying this tax. Instead, they farm only for themselves, smuggle their produce elsewhere, or simply cease farming altogether. Insecure property rights also discourage farming, as in Zimbabwe where white farmers have had their land confiscated by the government for no other reason than that they are white. Moreover, rather than distribute this land to the landless, it is often given to friends of the ruling party for their personal enrichment.

In short, foreign aid can short circuit the development of the free market economies that will be the true engine of renewal for Africa, and can help to sustain and spread the corruption that is currently choking off any hope of development. Perhaps more importantly, basic elements of civil society (such as private property rights) are in many cases simply nonexistent. Even if the foreign aid funds manage to make it into the hands of average citizens after winding through the maze of corruption, there would be very little opportunity for those individuals to effectively use the money for their betterment.

For Bono to truly help Africa, he should spend more of his time focusing on trade and the development of solid civic institutions, not foreign aid. To his credit, he has acknowledged that trade has an important role to play in the process. In an interview published by the Times Online (UK), Bono acknowledged that restrictive trade policies can have a devastating effect:

Q: But isn’t the left more your friend than the right?

A: Not necessarily so. The left may offer more money to fight Aids or deal with the debt burden, but they scuttle off when we talk to them about trade reform. The CAP [common agricultural policy] — so supported by the left — denies African products access to our supermarket shelves while we flood them with subsidised produce.

Bono and his wife, Ali, have also started a clothing line – Edun – in an effort to bring economic development to underdeveloped areas. From Vogue Magazine:

“We realized that outside of charity, outside of justice, there’s good old American trade, commerce. And this new idea of conscious commerce — well that finally is the only thing that’s going to fix this problem long term. ‘Cause you can fix the bad trade agreements — we’re working on that. And you can increase aid. And by the way, the United States is number 20 on the list of richest countries in per capita giving to the poorest of the poor — i.e., you’re at the bottom of the class. And the reason no one knows that is you can always say you’re giving more than anyone else, and you are giving more than anyone else, but not per capita. It’s just because you’re a bigger country. If we use Europe as a comparison to America, then you’re in the dust. But the point is, in the end, America does have a clue about how to rid the world of extreme poverty.”

“If you have it made in Africa,” says Ali, managing to get in a word — and pointing out to her husband that it is about time to leave the Roundstone Inn, to get back on the road to Luggala — “you create trade there, you can create jobs there.”

Thus Edun. Thus a factory in Peru and Tunisia that is busy filling the initial orders. Thus colors in the fabrics made in Peru that are, like the fabric, organic, using natural dyes — coffee, blue corn, gardenias. Thus Edun’s CEO, Richard Cervera, an entrepreneur brought in by Ali and Bono, has already hired someone to represent the Hewsons in Peru and also to look for new ways to bring economic prosperity to a town and to small organic farmers, for new ways to open other old factories, to create jobs through trade. The Hewsons see the possibilities of social transformations in trade but see also the beauty of compassion as a selling point, as a plug, as a pitch that sails nicely through the marketplace and attracts the customer that Edun hopes to attract.

Whether or not that business model will be profitable and successful in the long term is an open question, but it certainly is refreshing to see the acknowledgment that trade can lift the world’s poor out of extreme poverty.

And yet even with the acknowledgment of the importance of trade, it can’t be denied that Bono’s primary focus remains on an effort to reinforce the same old solutions that haven’t helped in the past. Prior to taking a leave of absence from the Acton Institute, Rev. Gerald Zandstra delivered the keynote address at the Acton Institute’s annual Chicago luncheon. Drawing from his wide experience in Africa, he had this to say about Bono’s efforts:

Bono… In one sense, I love the man because he has shone a light on some of the catastrophe – human catastrophe that’s going on in Africa – through AIDS, through lack of opportunity, through lack of business, through lack of development, and he’s developed this campaign called the One Campaign, and he’s increasing donations all around the world and he’s calling for the various developed nations in the world to increase their contributions to African nations to actually help them get out of poverty. And in that one sense, the man has wonderful intentions. But he’s completely wrongheaded about how you’re going to fix the problems upon which you’ve shone this light. The answer, according to Bono, is more government-to-government money. And that’s worked so remarkably well in the last 40 years.

This is a true story: I was in Kenya a couple of years ago before the elections, and President Moi, who had been long-term president of Kenya was still in office – he was about to be term-limited out – and he was speaking in the hotel where I was staying. And I thought oh, this is fascinating – I’ve got to sneak in, I’ve got to hear this speech! He gave a remarkable speech. He said – you know, the IMF and the World Bank are demanding that we repay the three billion dollars that we have borrowed from them, but I look around Kenya and I don’t see that we are three billion dollars better off. And until somebody from the IMF and the World Bank can come here and show me how we are three billion dollars better off, I say we don’t pay one thin dime. And of course the crowd went “hooray,” and I thought I’m going to try this with a home improvement loan when I get back! “You gave me 25 grand, I was going to fix up the kitchen, but I went to Vegas, and… and I don’t know where the money is. And I shouldn’t have to repay it because my kitchen still looks the same.”

When Moi was put out of office, do you know how much his personal assets were? 3.3 billion, which means that he invested it fairly well. 3.3 billion are his direct, provable assets. And yet Bono is traveling the world highlighting the problem but yet also highlighting the exact solution that has only exacerbated the problem.

In my estimation, Zandstra has it just about right. Bono has worked very hard to shine a light on a real human tragedy, and his advocacy has great value in that regard. But his focus needs to change. It’s clear that the value of trade and economic development has not been lost on him. But he would have a better chance of changing the world for the better if those items were the focus of his agenda, not just a sideshow. Perhaps we can send him to a FAVS conference…